Todd Chism, who became a Spokane firefighter after graduating from Everett High School, was arrested in January 2008 after a search of his Stevens County home in Eastern Washington.
Detectives initially believed Chism, a fire department lieutenant, downloaded child pornography.
"Once the investigation was completed, the evidence established that Mr. Chism had not downloaded child pornography and that the Chisms had been the victims of credit card fraud," State Patrol spokesman Dan Coon said Friday.
In a 2008 statement, the Stevens County Prosecutor's Office said there was no evidence of child pornography on either of the computers taken from Chism's home. Prosecutors said there was evidence Chism's credit card was accessed by a third party and the account was used to buy child pornography.
"We regret that in this case, the investigation became focused on a person who the evidence, after full analysis, does not show was involved in this heinous trade," prosecutors wrote.
The $2.4 million settlement will be paid from a state fund set up to cover civil judgments against state agencies.
"This was a good faith effort to protect children, but there were oversights during the investigation," Donald Sorenson, risk manager for the State Patrol, said in a press release. "We apologize for those oversights, and regret the damage done to Mr. Chism's reputation and the distress this caused his family. New practices are in place to prevent these types of oversights in the future."
The patrol remains committed to protecting young people from sexual predators, officials said.
"Making mistakes doesn't mean you stop trying. Professionals learn from mistakes, get better at what they do, and move forward," Sorenson said.
Gail Chism, of Everett, said the wrongful arrest took an enormous toll on her son and his family.
"Their whole life was ripped apart," Chism said. "It has been unimaginable pain and agony."
Todd Chism, 44, said he is glad to put the episode behind him.
"It was time to stop the bleeding," he said. "This has caused significant financial and emotional damage to my family. It was not so much about the money. It was about holding them accountable. I felt the civic duty to continue the fight and get the outcome we did in hopes it doesn't happen to another innocent family."
Coon said detectives tried to follow other leads "but it really went nowhere."
"What we are seeing in this line of criminal activity is they are pretty sophisticated and getting more sophisticated," he said.
The child pornography allegation wasn't the only run-in Chism has had with the patrol.
He was charged in 2010 with four counts of assault after a confrontation with troopers. A Stevens County jury acquitted him on all counts and ordered the state to pay his attorneys' fees.
The patrol has made changes in how it handles child pornography investigations after the Chism case, Coon said.
There is more supervisory oversight and review and more consulting with high-tech investigators, he said.
Todd Chism, who fondly remembers jumping onto the box cars of trains passing through Lowell as a child, said he gets back to Snohomish County to visit family and friends from time to time. He plans to compete in an Iron Man triathlon in Lake Stevens this July.
Despite the settlement, he said he doesn't believe his life will ever be quite the same.
"There is damage that just never will be undone," he said. "Unfortunately, I will just have to accept that."
Eric Stevick: 425-339-3446; email@example.com.
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